Mary Tao In a prior blog post, we saw how Maiden Lane evolved over time. It was here that a momentous event occurred in 1790, changing the history of the United States. While serving as Secretary of State in 1790, Thomas Jefferson rented a “mean house” at 57 Maiden Lane "for 106 pounds ...

Piketty's new book (English translation out in March as "Capital in the 21st Century') shows convincing historical evidence that disasters such as wars and hyperinflation have been the main factors reducing inequality of wealth. Other causes have been population increase, and sometimes tech progress. Also, the basic cause of wealth inequality is that in normal times the rich receive a return on their investments which is higher than the rate of GDP. So, the rich are bound to get richer. He recommends not more disasters, but worldwide wealth taxes. Obviously a long term solution.

Lane Kenworthy: Living Standards in an Open Economy: The Danger of Front-Loading Income Inequality, by Lane Kenworthy: Over the past decade, the American left has directed a growing share of its attention at income inequality.[1] Indeed, for some, reducing income inequality seems to have become...

Job guaranty seems a better idea, and probably more nearly politically feasible. There are plenty of public service and infrastructure projects, which if well managed could maintain workers morale as being useful members of society. Basic income, however might turn out to be a subsidy for employers paying low wages.

Tim Harford argues that "A universal income is not such a silly idea". His argument ends with: ... There is an alternative way to look at all this: an increasing number of economists are beginning to worry that technological change may make large numbers of people completely unemployable. In sho...

Today the issue of tax cuts for the wealthy is once again front and center in Washington, as part of the debate over how to reduce the federal deficit. And Mr. Sanders is once again talking, carving out a place for himself as the antithesis of the Tea Party and... Continue reading

I wasn’t always this way, but I spent a few years as an English teacher, which obliged me to bone up on fine grammar points. When most of my reading was confined to books and magazines, I didn’t see many errors. Now that I read so many blogs, however, I’m... Continue reading

We Americans aren’t careful at all. In a country that supposedly draws a line between church and state, we allow the former to intrude flagrantly on the latter. Religious faith shapes policy debates. It fuels claims of American exceptionalism. via nytimes.com Some may feel a duty to evangelize, but please... Continue reading

Of all the state election results across the nation, few can top the shocking good sense of California voters in approving temporary tax increases to raise $6 billion a year to shore up the state’s tattered public schools and university system. That’s right: There were voters in these hard times... Continue reading

One of the most important results on Tuesday was the election of Elizabeth Warren as United States senator from Massachusetts. Her victory matters not only because it helps the Democrats keep control of the Senate but also because Ms. Warren has a track record of speaking truth to authority on... Continue reading

No, you cannot have your country back. America is moving forward. That’s the message voters sent the Republican Party and its Tea Party wing Tuesday night when they re-elected President Obama and strengthened the Democrats’ control of the Senate. No amount of outside money or voter suppression or fear mongering... Continue reading

But unintended pregnancies – which account for about half of all pregnancies – have huge economic consequences for women’s employment, family welfare, public spending and children’s health. In a recent Guttmacher Institute study of women at 22 family planning clinics in 13 states, the most frequently cited reason given for... Continue reading

Everybody reading this has probably run across the persistent (and well-subsidized) narrative that goes something like this: virtually all of the variability we see in wealth can be explained by intelligence, talent and character with luck and inequality of opportunity playing little role in a person's success. In this narrative... Continue reading

As in the movie "The Sixth Sense," (in which many ghosts didn't know they are dead and only see what they want to see), for most Americans our auto centric suburban way of life is dead, but most of us don't know it yet, and we only see what we... Continue reading

A Nobel for Planning?: “The combination of Shapley’s basic theory and Roth’s empirical investigations, experiments and practical design has generated a flourishing field of research and improved the performance of many markets,” said the committee awarding the Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel. via economistsview.typepad.com... Continue reading

Delong and Krugman have been saying the same thing, but it helps to come at it from a new direction as you have done. Bravo!
@Yet another Chris-
Greece can't borrow, but ECB can.
Stockton, California can't borrow, but US Treasury could, if GOP didn't block all constructive efforts.

The IMF's admission (p41 of this pdf) that "the multipliers used in generating growth forecasts have been systematically too low since the start of the Great Recession" is being interpreted as a victory for Keynesianism, because it means that fiscal austerity is doing more damage than the IMF or...

The 15-hour working week predicted by Keynes may soon be within our grasp – but are we ready for freedom from toil? via aeonmagazine.com John Quiggin seems to have covered everything here, except curiously for global warming. Continue reading

For the past four decades, the "marshmallow test" has served as a classic experimental measure of children's self-control: will a preschooler eat one of the fluffy white confections now or hold out for two later? Now a new study demonstrates that being able to delay gratification is influenced as much... Continue reading

At the beginning I was a proper Calvinist. Before it got watered down in the 18th century, Calvinism was very often about predestination vs. free will. So when I started researching the subject, I went back as far as the English Puritans and moved forward to Jonathan Edwards, who was... Continue reading

As usual, the so-called law of supply and demand explains everything. There's not enough information on the web about good, affordable Bordeaux wines, while there are too many political rants. I suppose it's the election season. Or maybe it's the Gresham's law of blogging: bad dope drives out good. But... Continue reading

We have just finished watching the first season of the internationally top-rated Danish TV series "The Killing". I now see that we are way behind the times as the Danes have already broadcast their third season, and the Americans have done a complete remake of the first Danish season after... Continue reading

despite his complete lack of faith in the ability of politicians to affect the economy, Hayek, who is frequently cited in attacks on entitlement programs, believed that the state should provide a base income to all poor citizens. To be truly Hayekian, Boettke says, Ryan would need to embrace one... Continue reading

One more from Tim Duy: Is There Even a Panic Button in Europe?, by Tim Duy: I didn't think it was possible, but my confidence in the ability of European policymakers to pull the Continent out of crisis continues to fall. This is saying a lot because I had virtually no confidence to begin with....

Martin Feldstein calls for a fall in the value of the euro: A rapid fall in the euro can save Spain, by Martin Feldstein, Commentary, FT: The possible breakup of the eurozone is now openly discussed... The declining value of the euro holds the key to the eurozone’s survival. ... A lower value o...

Beautiful. Finally a clear and accurate explanation of how money and credit actually work, As one who has worked in banks, corporate treasury departments, and small business, I can testify that this is how it actually works. As much as I admire Krugman and DeLong, I wonder if they really understand this. I hep this post means that DeLong at least is not snubbing (snubbing) Keen.

In the neo-Wicksellian framework that Krugman likes to use when the economy is at its zero nominal interest rate bound, the central immediate problem with the economy is that because private households want to deleverage--planned saving at full employment is high--and because private businesses...